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The New Senior Care Franchise Owner
But many of them will not be retired in the traditional sense. They’ll be working, according to a 2014 Merrill Lynch Retirement Study that spotlights the “new retirement workscape.” The report concludes that “in the near future, it will become increasingly unusual for retirees not to work.” Driving forces cited in the study include increasing life expectancy, elimination of pensions, economic uncertainy and re-visioning of later life towards purpose and social engagement.
Couple this with the stark reality that 22 percent of boomers have less than $100,000 of retirement savings — and half of those have less than $50,000. It’s no wonder that 62 percent of younger boomers (ages 51 to 65) expect employment to be a source of income in their retirement years.
Boomers are responding to the challenge by starting their own businesses in record numbers. According to the Kauffman Index of Entrepreneurial Activity, 23.4 percent of new entrepreneurs in 2013 were aged 55 to 64. Why the interest in entrepreneurship? When older workers are downsized, it can take nearly twice as long for them to find new jobs, so it makes sense to many boomers to start their own companies. Other boomers choose entrepreneurship as an encore career in order to pursue a passion, work on their own terms and continue to create wealth for themselves and their families.
Bohnne Jones of Nashville, Tennessee, fits both categories. After 31 years in health care, she was downsized five times between 2002 and 2007 — until she turned to something completely different. “I was looking to own my own business and work pursuing my passion for design, fabrics and color.” Jones found her answer in the Decorating Den Interiors franchise that she has owned in Nashville for the last eight years.
She’s not alone. Many baby boomers have embraced franchising as the chance to start a business without having to build it from scratch. The U.S. Small Business Administration, “Franchising can be a great alternative if you want to have some guidance in the startup phase of the business.” Jones agrees. “For me, it was an ideal situation. I chose to move into an industry that was not at all where my experience lay. I interviewed existing franchise owners, as well as people who had left Decorating Den. They all said the same thing: Follow the system and you will do well.”
The advantages of buying a franchise include built-in name recognition, proven business models and operational procedures and a wealth of support from the franchisor in locating, supplying and marketing the business. Jones used her own retirement assets to buy her franchise just before the onset of the Great Recession, and the educational materials and low-cost marketing ideas provided by Decorating Den helped her weather the storm. She also values the community that franchising creates. “You can get support from other owners who have experienced the same things you have, and you can get some great advice,” she says.
Although all franchises require an initial investment, those worried about lack of sufficient savings can still find franchises that don’t necessarily require large upfront payments or high net worth. Low-cost franchise options include commercial and residential cleaning services, printing and promotional products, tax preparation and a variety of services for children or seniors.
Small Business Administration loans may also offer a source of financing. And buying an existing franchise from a current owner, as opposed to building a new franchise location from the ground up, can give an entrepreneur more certainty when making a business investment. As with any undertaking, do your research and consult a trusted financial advisor to see if franchising makes sense for you.
Franchising can help baby boomers match their interests, their entrepreneurial spirit and their specific financial situation to a business they can build on — with help and guidance from the franchisor, franchise associations and their fellow franchisees. Says Bohnne Jones, “I’ve had eight years of employment without the worry of yet another round of downsizing. My business is strong, and I feel that I could, in a few years, step back and allow the business to take care of me. Then I can downsize myself!”Read More
Doug Dix is the owner of Homewatch CareGivers serving Cedar Rapids, Iowa. He opened his business in 2005 and shared his thoughts on how the business has changed in that time, what he has learned since opening his doors, and what has made it all worthwhile.
Q: How is a day in your business different today than it was in your first year in business? Well, my first day I walked into this office—I still have the same office—and I had zero clients and zero employees and I sat down in a chair and leaned back and thought, “Now what do I do?” Fast forward 10 years and there isn’t time to sit back in the chair and wonder. Just this past Sunday, I got a call from a caregiver at 9 p.m. who said she had fallen on the ice and was going to the hospital. To avoid any delays in this clients’ care, I ended up caring for the client myself. In my first year, I built my business to a healthy monthly run rate—but in a matter of a couple of weeks I lost about half of it. Then, I was able to add more clients and climb back up. Today I have about 55 clients and 40 employees. I have two caregivers that have been with me the whole 10 years and a few more who have been with me for seven or eight years. Probably the biggest thing I’ve done for my employees, my caregivers, is to pay them overtime and I’ve always done that. I also give them a week’s paid vacation and just treat them as honestly and fairly as I can.
Q: What would you do differently in your business knowing what you know after 10 years? This business is more competitive than it was 10 years ago. I’ve made probably every mistake you can, but I’ve gotten more relaxed over time and my staff has gained experience too so that makes it easier to move the chess board pieces around, so to speak. It can be tempting to pay people to do everything for you, but this is my livelihood too so I stay involved.
Q: Can you share the biggest highlight of your last 10 years in business? There isn’t just one highlight. This is a people business and you get rich in many ways that aren’t necessarily about money. Twice, at two different funerals, someone stood up to personally and publicly thank me and my staff for helping them and that’s really better than any paycheck. It just confirms why you get in this business. I used to be in the financial business and worked for banks and those are good, honest businesses and people, but it’s nice to be in a business where it’s about more than money. Another highlight is that I’ve got caregivers who I know giving them a job made a difference in their lives. They are good caregivers. Caregivers tend to be people who are great at taking care of others but not always great at taking care of themselves. If what they put on my tombstone is, “He treated his caregivers too well,” then I’m happy I did this. Finally, interacting with the clients is often a real highlight. I took one client catfishing a couple of times. We caught two buckets of fish! He can’t go out to do that anymore, but he’s still talking about it. I have heard stories from people who were POWs during World War II and learned so much from them.
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Hiring Care Givers in the Senior Care Industry
Ask any Senior Care Franchise owner what the secret to the business is and you will get one answer…..the caregivers!
Staffing is a big concern in any business, and it is certainly one in home care. As new home care franchise owners go out into the community to let people know they are open for business and hoping to sign on new clients, they also need to have trained caregivers on hand to work with those clients.
From one perspective, it’s exciting to read the statistics on the number of people who are aging in place and living longer, but who still need some degree of assistance with daily activities.
The United States Department of Health and Human Services’ Administration on Aging found that in 2013, there were 44.7 million people age 65 or older in the country, making up 14.1% of the population; by 2060 they project that figure to more than double to 98 million or 21.7% of the U.S. population. However, it’s like a bar graph with that demographic heading straight up and a question mark below it for the number of capable caregivers to meet the demand.
In addition to the elderly, many people of all ages require assistance to remain at home, including people recovering from surgery, living with a chronic condition such as MS or Parkinson’s, and those who are physically or developmentally disabled. The future demand for in home caregivers is evident in the Bureau of Labor Statistics estimation that they are one of the fastest growing professions in the U.S.
Learning more about people who choose to work in the caregiving profession including their training, professional and personal backgrounds, and why they do what they do, can go a long way toward relieving concerns about staffing a home care business.
Donna Barr, 59, got her degree in early childhood education before becoming the owner of a preschool in Connecticut.
“I just adore helping people and helping children,” she says. Ms. Barr has been a caregiver with Senior Care Franchise serving Western Washington state for the past three years of her whole 25-year caregiving career.
“I’ve also worked with a few elderly clients,” she says. “I like to make things easier for them, to get to know them and understand them.”
When it comes to working with young children, Ms. Barr is passionate. “I like it when I win over the parents’ confidence,” she explains. “At the end of the day, I can share cute stories about what their child did.”
Yes, caregivers can and need to be trained, but for many there is an innate desire to help others that enhances their skills. Jeannet Gutierrez, 58, is the mother of two grown children and a full-time caregiver for Senior Care Franchise in Washington.
“When I came to America from Peru, being a caregiver made me feel like I was helping my Mom again,” Ms. Gutierrez says. “People are so lonely sometimes.” In Peru, Ms. Gutierrez worked in her mother’s restaurant and as a secretary for a computer business, but when she came to the United States, she went to school and got a nursing assistant certificate. Now she takes pride in hearing that the families of her clients are happy with her care.
“I have worked with many hospice patients,” she says. “I feel very helpful when I talk to the family and explain how they need to still show their love.”
Ms. Gutierrez is about to celebrate nine years as a professional caregiver. These two women are just a small sample of the many people who seek out work to serve others—children, elders, or infirm—in the home care industry.
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5 Second-Act Careers To Sail Through Retirement
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A new book by Nancy Collamer, a career coach based in Old Greenwich, Ct., offers hope to the burned out and the bored in mid-career. It’s possible to switch gears in midlife and to start a new venture that brings rewards, both financial and emotional, she writes. The book, Second-Act Careers: 50+ Ways to Profit From Your Passions During Semi-Retirement, offers more than 50 different career pointers for the semi-retired worker who might want to become anything from an adult education instructor to an executive recruiter to a mediator to a franchisee.
Collamer includes advice and concrete information about how to make these transitions. Examples: Adult educators may try to sell their services to a place like the Learning Annex. Aspiring mediators can take an online course at mediate.com. Would-be franchisees should check out the International Franchise Association (franchise.org), which connects with franchised businesses in a range of areas, from custom-built print shops to 1-800-FLOWERS to Weed Man lawn care services.
Aside from the many tidbits of advice, the most compelling parts of the book are the real-life stories about people who have made successful career changes and found second acts that are both satisfying and that bring in sufficient cash. I’ll share five of my favorite stories here:
1. Jack Turk, Microsoft employee to magician marketer
When Turk turned 50, he decided to quit his job as a writer, program designer and game designer at Microsoft. For 15 years, he had worked at the same company and was earning a six-figure income. But his lifelong passion lay elsewhere. All along, Turk had run a side business as a magician. He used his corporate experience to bolster the marketing he did for his magic business. Meantime, he noticed that other magicians were struggling to get work. He also knew that a man named Dave Dee ran a business that helped magicians market themselves. Turk wound up buying the business from Dee, spending a year working alongside him while the enterprise changed hands. Now Turk runs magicmarketingcenter.com and sells products like “Success Strategies for the Restaurant Magician,” while doing more than 200 magic events per year, mostly birthday parties.
2. Debra Hamilton, litigator to pet mediator
Hamilton, 54, had worked as a litigator before taking time off to raise her children. When her son started first grade, she decided to train as a mediator. A dog lover and breeder, she wanted to specialize in animal-related conflicts, like disputes over who gets to keep a dog after a divorce and clashes involving trainers, veterinarians and handlers. She charges $500 an hour for her services, with a two-hour minimum. Most cases take six hour to resolve and both parties in a dispute assume equal responsibility for her bill.
3. Beth Chapman, public relations consultant to senior move manager
For nearly 20 years, Chapman, 68, worked as a PR consultant in financial services. Then in 2008, as the financial crisis cut into her client base, a friend sent her a clipping about so-called senior move managers who help older people with the difficult process of divesting possessions and moving to a new, smaller home. After moving 18 times herself, settling five estates and working at her church’s rummage sales, Chapman knew she could do the job. She discovered an annual conference run by a trade association, the National Association of Senior Move Managers, and picked up lots of valuable information at the conclave’s many seminars. Chapman started her own senior move business, called Extra Daughters. She also runs a service she calls Life Legacy Party, which helps clients inventory their valuables and distribute them fairly. Though she had years of experience in PR, she learned that her best marketing strategy was the most down down-to-earth, posting on community bulletin boards.
4. Eve Young, part-time bookkeeper to celebrant and acting extra
For most of her adult life, Young, 60, spent her time raising her kids, volunteering in her community and bookkeeping part-time. When her children left her home in Glen Ridge, N.J., Young read about a nonprofit called Celebrant Foundation and Institute that trains people to officiate at events like weddings. Coming from a family that was part American Indian, Young had taken part in many rituals and ceremonies and decided to study to become an interfaith minister. Young specializes in personalized ceremonies, like a wedding for a single mother of Polish extraction and an African-American man. Young charges $350 per ceremony and does two per month. She also started working as an acting extra after reading a classified ad, getting paid up to $125 for a job on a movie set and as much as $250 per day as a model for print publications.
5. Alison Talbert, travel agent to importer
After working as a travel agent, Talbert, 45, became a stay-at-home mom until her two kids reached their teens. Casting around for a part-time work option, she learned about a course for people who wanted to import goods from Ecuador. The course included a trip to South America and meetings with local artisans. Talbert stocked up on goods on that first trip and has since returned a dozen times. She buys leather bags, woven shawls and jewelry, and sells them to vendors who then sell the goods retail. She has also traded roses and other flowers and plans to open her own online retail stores.
A few caveats about these stories: Collamer doesn’t offer enough financial details for us to know how profitable these enterprises are and whether the people she describes are truly living on what they earn. I suspect that the first three described here, magician Turk, mediator Hamilton and senior move manager Chapman are all earning their keep. But my guess is that Young and Talbert get help from a spouse or they have substantial savings. The financial details of Talbert’s Ecuadoran import business are especially vague. But it does sound like Talbert has found a fulfilling path that can lead to profits down the line. The takeaway message from Collamer’s book is that many people in mid-career can discover ways to channel lifelong passions into new careers. Or they can find their way into totally new vocations that match their interests and talents
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Fed Confidence in the Economy
For starters, let’s consider why the Fed raised the rate in the first place: confidence in the U.S. economy. The central bank, following its mandate to foster maximum employment, stable prices and moderate long-term interest rates, determined that the economy has gained enough momentum to flourish despite a modest interest rate increase. After all, household spending is up, and the latest U.S. Bureau of Labor Statistics jobs report indicated a steady pace of employment, with 211,000 new hires in November and 5.0 percent unemployment (half the peak unemployment of 10.0 percent in October 2009).
Meanwhile, U.S. small business activity is on the rise in almost all 50 states. Entrepreneurs are poised to reap the benefits of the stronger consumer base that comes with improved employment, but the rate hike will increase the cost of capital for those seeking traditional financing in 2016. While the Fed fund rate doesn’t directly affect business loans, banks use that rate to set their own prime rates, which will impact small business loans.
The Bad News for Traditional Small Business Lending
Payments will increase — modestly — on existing loans with floating interest rates, such as most Small Business Administration (SBA) loans, unsecured lines of credit, business credit cards and peer-to-peer lending. This additional expense could undercut cash flow and profitability for some, and the cost of credit will also rise compared to previous years.
However, the change isn’t as dire as it may sound. Yes, every penny counts to small businesses, but an increase of 0.25 percent probably won’t force owners to shutter their businesses. But what if the Fed raises the rate further in 2016? While experts disagree on the amount that rates might rise next year, the Fed probably won’t rush to increase them. Wary of choking off the country’s slow recovery from the Great Recession, the Fed has consistently advocated a slow, cautious approach to monetary policy.
Even in a scenario of a 1 percent increase over the course of a year, how much would that change the cost of capital? The SBA lenders we work with at Guidant aren’t anticipating an increase in any other fees, so the change in cost should come from interest rate alone. According to TD Bank’s online calculator, if you have a $250,000 SBA loan amortized for 120 months that jumps from 6.0 percent to 7.0 percent. Your monthly payment of $2,787 would increase by $129 to $2,916 for an annual increase of $1,548. It could be wise for business owners to build at least a 0.25 percent increase into their budget assumptions for January and July to prepare for a modest increase in the cost of capital.
How to Take Advantage of the Upswing
The Fed rate increase will likely encourage a lot of savvy entrepreneurs to make the most of current rates while the economy’s on an upswing and before rates can jump significantly. Sure, financing might cost more than last year, but those that are disciplined enough to take their loan to multiple sources may have enough leverage to lock in fixed rates near historical lows. An SBA packaging firm may be helpful in this regard. Also, adjustable-rate financing will remain a bargain for the foreseeable future. Meanwhile, businesses won’t see any increases in their existing fixed-rate loan payments.
Even business owners nervous about interest rate hikes can capitalize on warming economic conditions by pursuing funding options that don’t depend on interest rates, such as Rollovers as Business Start-ups(ROBS). Rather than borrowing, entrepreneurs can invest funds from their existing retirement plan into a small business or franchise without incurring a tax penalty. Since it’s not a loan, ROBS will never be affected by interest rate hikes.
More Available Financing
I also anticipate greater availability of small business financing. Average FICO scores are trending upward. Potential borrowers who declared bankruptcy or defaulted on mortgages when the economy was at its worst are seeing those big derogatory marks drop off their credit reports, and lenders are demonstrating greater flexibility to applicants who have been working to improve their credit.
How Consumers Will Be Affected
Consumers won’t be unaffected by higher interest rates, since consumer debt has been rising. However, the rosier employment situation will help cushion the impact. Better rates benefit savers, but consumers probably won’t be tying up all their cash into CDs or savings accounts in droves. Why? Even if they receive larger returns on cash savings relative to the past seven years, inflation still remains below two percent, so saving doesn’t increase their buying power — they might as well spend, which is more good news for business.
Now, I’m not claiming that the U.S. has completely shaken off its economic woes. A sizable “jobs gap” of 2.8 million jobs persists between current employment and pre-recession levels, and both consumer confidence and small business optimism remain shaky. Still, entrepreneurs have a window of opportunity before rates rise significantly to secure reasonable financing that can help them launch or expand at a crucial turn in the economy and give them plenty of reason to celebrate in 2016.
– David Nilssen, CEO & Co-founder, Guidant Financial
IT’S NOT JUST YOU
You may already be a family caregiver and not even know it. There are an estimated 43 million family caregivers in the United States, according to a survey by AARP and the National Alliance for Caregiving. Of those, this survey found, about 39.8 are caring for an adult. To put it another way, 85% of those caregivers are caring for a relative with 49% caring for a parent or parent-in-law.
The reasons someone needs care can vary, though with Alzheimer’s or dementia increasing in the population worldwide—an estimated 46.8 million people worldwide living with dementia in 2015, according to Alzheimer’s Disease International—more and more people need help as this disease progresses. As they age, people sometimes just struggle with activities of daily living (referred to as ADLs), such as bathing or showering, dressing or instrumental activities of daily living (called “IADLs”) like doing housework, making meals, and adhering to medication instructions.
ARE MOM AND DAD ALRIGHT?
When spending time with your elder loved one during the holidays look for warning signs that they may be needing more help before they can admit it to you. It’s not necessary — or particularly productive — to point out any issues you see to this individual. Simply be aware and then share these insights with others—maybe your spouse or sibling—who could be involved in this care down the road.
Warning signs can include difficulty rising unaided from a sitting position, unkempt appearance, extreme mood swings, or if you are at their home you can look for things like stale food, unpaid bills, garbage piling up.
WHO’S TO SAY?
Right now, your loved ones may be doing just fine and continue to take care of themselves so it seems silly to ask them about their future care needs. Yet for their benefit and yours, open up the channels of communication sooner rather than later. Think of it like this: do you want to have a “what if?” conversation before an emergency arises or a “what now?” conversation later when there is an urgent need?
Many families find themselves in a situation where an emergency puts a decision about long-term care front and center in a hurry. When it comes time to have the conversation with your loved ones, it’s a good idea to start with an innocent “ice breaker” like, “Can I get your opinion on a couple of things?” Additionally, use the word “help” carefully. That word comes with a connotation that seniors see as a loss of independence. When going into the first discussion, know that it is just that: the first one. There will probably be several talks while the family goes over details.
If possible, prepare a script ahead of time. You shouldn’t actually use it, but it helps to organize your thoughts. The script or letter lets you pinpoint your precise concerns and target subjects you may feel too awkward or anxious to initially say out loud. Don’t be afraid to ask for help. You can talk with a doctor or a friend who already has experience with this type of situation and they can even be there with you when you have the conversation with your parents.
Pay attention to how you listen to your loved ones and listen actively. Don’t come in with preconceived expectations of what your mother or father will say – they will probably surprise you. Also, try putting yourself in your loved one’s shoes before, during and after the conversation. How would you feel if your children were in your place, having the same conversation with you?
As you define the big picture, make sure you understand what is most important to your loved ones. Often this focuses on the idea they will lose independence. It’s hard for people to feel dependent on others – even if it’s their own family members. You should also be ready for how much your life will change if your parents are suddenly dependent on you.
Whether the preference is for assisted living, a nursing home, in home care, living with a family member, make sure you do a lot of research as this conversation—possibly started during the holidays—continues between you both. Your research may include visiting facilities, a new city, interviewing caregivers, and creating schedules with other relatives and neighbors.
KEY STRENGTHS AND SKILLS:
Gressa is already familiar with running a small business, networking in the community, working with clients, and creating custom designs that fulfill the needs of the customer. Her transition from graphic design to window treatment design will be seamless.
The Ripple Effect of Aging in Place
Study after study shows that a great majority of us want to “age in place.” This vague phrase simply means that we want to remain in the homes where we have lived for a long time, where we made memories with family and friends, where we know our neighbors, and have established familiar routes to places we frequent—even when age or health-related changes make it difficult to care for ourselves safely. One AARP study found that 80% of respondents over age 45 expressed a preference to age in place even when assistance is needed.
A recent Wall Street Journal article found that there will be a significant increase in people in need of home care services due to a confluence of aging Baby Boomers and the desire to age in place rather than in a facility. The article stated that the “Social Security Administration estimates that 9,600 people a day will turn 65 in 2015, up from 7,800 a day in 2010.”
Is There a Right Age for a Move?
Even those individuals and families that choose to move to senior living, assisted living or a nursing home seem to be choosing to postpone that move for as long as possible. According to an article by Rick Banas of Gardant Management Solutions, “the average age of individuals moving into senior living is now the same as for assisted living—84.” He notes that in the 1980s and 1990s, the average age was 78 for people who moved into senior living apartments.